Financial, Economic and Social Mood Update (August 1, 2019)
The Dow Jones 30 Industrials stock market index reached a new nominal high value on July 3, 2019 – slightly surpassing the previous record from October of 2018. Bitcoin rose by 75 percent in the month of June, has lost some value since then, but is up by a net 143 percent since July 2017.
The topic of this month’s update is the rise of the so-called “far right” wing political parties across the world. This phenomenon became especially noticeable after the recent June 2019 parliamentary elections in the European Union. Such political groups have had tremendous difficulty in being elected to political bodies since the end of Second World War (1945), but they do exist throughout the world, and of late have had their greatest electoral successes since 1945. The reason for their lack of success since 1945 is of course directly related to the cumulative horrors due to the scourge of “nationalism.” Nationalism came to the forefront of geopolitics with the French Revolution, the rise of Napoleon and the Napoleonic Wars (1789-1815) and culminated in the horrors of two global world wars which laid waste to much of both Europe and Asia (1914-1945).
Today’s European Union is the fruit of negotiations between the “Benelux” governments of the Belgium, the Netherlands and Luxembourg at that time domiciled in exile in London in the autumn of 1944. The thinking was that nationalism (and the corporate entity of the “nation state”) had to be subverted in trans-national political organizations where people would live and work together in peace, prosperity and security. Benelux was signed in 1944, came into effect as a customs union / free trade zone in 1948, and grew into the European Coal and Steel Community in 1952, the European Economic Community in 1957 and the European Community in 1965. A popularly elected European Parliament was launched in Strasbourg (the capital city of the German-speaking French Alsace province) in 1979 and these elections have been held every 5 years since then (1984, 1989, 1994, 1999, 2004, 2009, 2014 and finally again in 2019). The European Union (EU) came about in 1993. The “Euro” currency name was adopted in 1995, the currency was introduced to financial markets in 1999 and actual physical currency was introduced in 2002, thus replacing the former national currencies of the individual countries or “nation states.”
Political groupings (or parties) are quite similar across much of Europe and they do have their approximate counterparts worldwide. In the first popular European election in 1979, the largest groups were the Liberals (31% for “old school” European liberals roughly comparable to Libertarians in the USA), the Social Democrats (28% for a center-left political group similar to moderate Democrats in the USA), the Christian Democrats (26% for a center-right political group similar to moderate Republicans in the USA), 11% for Euro communists (these grew out of the labor movement primarily in Italy and France) and the remaining 4% went to independents similar to the Liberals – being more focused on local politics and less focused on issues such as foreign policy or national defense.
The political landscape in 2019 is markedly different from that which existed back in 1979. The two largest groups in 2019 had 24% each – these being the moderate Christian Democrats and the second group being the NOT moderate far right wing. The Social Democrats fell to 20%, the Liberals fell even further to 18%, the “Greens” or “environmentalists” (who did not exist in 1979) won 9% and the European communists fell to just 5% of the popular vote in Europe.
The strength of the extreme right wing is by no means equal across Europe – in some countries they have become alarmingly strong, whereas in other countries they barely exist at all. The extreme right won absolute majorities in Hungary (53%) and in the Italy (51%), while they won a plurality in Poland (45%). They won 31% in the UK (in favor of “Brexit”), 27% in Slovakia, 24% in the Czech Republic, 23% in France (the far right wing movement led by Marine Le Pen), 18% in the Netherlands (the far right wing movement led by Geert Wilders), 17% in Austria (the Austrian Freedom Party), 16% in Latvia, 15% in Sweden, 14% in both Croatia and Finland, 13% in Estonia, 12% in Germany, 11% in Denmark, 9% in Greece, 8% in Lithuania, 7% in Cyprus and 6% in Spain.
A common thread throughout all of these far right wing movements is the fear of anything foreign or allegedly too different – be it based upon religion, race, or national origin, and the fear of the European central government in Brussels (executive), Strasbourg (legislative) and The Hague (judicial). The electoral power base of the far right in Europe is much like it is worldwide – it tends to be more rural (not so much in suburbs and almost not at all in large cities), more working class (or formerly working class), somewhat middle class, less formally educated, and demographically older (relatively few younger people support the far right wing).
It is one thing to oppose the status quo for disagreements of opinion or on differences in policy, but it is another thing to put forward “solutions” which make the current situation worse instead of better – this is yet another common thread among far right wing political movements……………and yes, such movements do exist all over the world – in the Americas (North and South), in Africa, in Asia as well as in Australia-Oceania. A case in point is Hungary, where the far right won 53 percent and where they control the national government. They are very anti-immigrant in a country which has relatively few immigrants and which is quite homogeneous. The reason why relatively few immigrants move to Hungary is due to the fact that the economy there (as is the case in much of the former Eastern Europe) is quite depressed. In other words, most younger people with both education and ambition would NOT move to such a place.
Yet another case in point is Italy, where the far right won 51 percent (largely held by the Northern League and by the Five Star Movement). Italy can be seen as a larger version of Greece – in other words, very economically depressed and fiscally broke or near bankrupt. The situation is similar in that very many of their own younger people with both education & ambition have already left Italy for greener pastures in other countries – in other words, for better economic opportunity elsewhere.
These parties of the far right have failed to offer any solutions which make things better instead of worse. They promote intolerance of whatever they see as too “different,” they bring back ugly ghosts from the past (nationalism, hatred, racism, intolerance and prejudice), they have failed to demonstrate maturity (or good behavior) when they are in office, and their economic policies seem to fear anything and everything which would lead to growth and prosperity.
If voters do not like an overbearing central government, then a saner solution would be to reverse that centralization and move back to what existed just a few decades ago. In the case of the European Union, it would mean looking more like the modern day European Free Trade Association (EFTA) – or more like what the European was in the 1950s through the 1990s. The problem with modern mass immigration (which is painful for both countries on the giving and on the receiving end) would likely be better solved to end BOTH the “War on Terror” (which is causing more terror) and the “War on Drugs” (which is costing the world even more lives than the “War on Terror”). The solution to the problems of today is certainly NOT to resurrect the hatred and the intolerance of the past – in other words, the very darkest and worst side of the “good old days.”
